Britain’s creative kickstarter: the BBC

Want to know the value of the BBC
to Britain’s £76.4 billion creative economy? Have a look at the unique impact
of its Manchester investment.

Lowry Theatre, Salford

There is a place a lot like
Northern California – where rushing rivers tumble over boulders through rocky
outcrops and pine forest. But it’s twenty minutes from downtown Stockport. You
could spend a sunny day driving about in the Goyt Valley, and confuse the
geography with upland California – until you switched on your car radio. At
that point, you would fall into a canyon of difference.

In Northern California, scan
across the entire FM waveband, and you might never find a station to stop on.
It’s 24-hour ‘adult contemporary’ formats, spiced up with religious radio – a
small ditch of choice that stretches from John Bon Jovi to Kanye, via rehashed
Old Testament admonitions.

But in the hills of Northern
Britain, your radio choice is actually Biblical in scale. Alongside many genres of music, you could
hear Melvyn Bragg exploring Abelard and
Heloise, or the theological differences between Sunni and Shia Islam, or
the vacuum of space. You could hear the Art
of Self-Borrowing as explored through J. S. Bach’s B Minor Mass. You could listen to an Alan Ayckbourn play or hear
Toulouse-Lautrec’s Moulin Rouge
characters brought to life. You could be transported, via broadcasting of
unchallenged intellectual richness, to one of the finest libraries in the
history of the world.

And what makes the difference?
The BBC.

For the last 60 years, the BBC
has been to radio and TV programme-making what Apple is to personal computing
today. The world champion. The sine qua
non. The BBC has quite possibly been the only UK industrial entity that has
consistently been in the global premier league in its field for over half a
century. Can you name another? British Rail? The Royal Bank of Scotland?

Industrially-speaking, the North
is a handy testbed for the wider impact of the BBC on our creative
industry, far from where the policies are made in smoke-free rooms – be that
Washington or London – and right where the programmes are made and actually
enjoyed.

We can see how the BBC impacted
on different parts of the North of England when it moved major assets there,
and what that might say in microcosm about the corporation’s role within the
British creative economy as a whole. And since we started with California, we
can comparatively think about how the ‘cluster’ effect of California’s
long-term embrace of digital creative companies brings extraordinary compound
benefits way beyond the value or cost of any given single player.

We can also consider how unthinkable it would be there to
consider the idea of dropping that most precious of industrial entities: a
truly world class player. Try telling
the burghers of San Francisco that Apple isn’t worth having any more, and
they’d chuck you off a cliff. We should
feel the same about the Beeb.

The BBC North Experiment

For a simple test of what the
creative economy of Britain would be like without the BBC, we can look at the
differing evolutions of the creative economies of the North West and North East
over the past five years, in the context of the BBC moving substantial assets
into one place (Manchester) but not another (Newcastle). It’s not a scientific experiment of course, but
it does offer a beguiling indication: where BBC North went made a far bigger,
wider difference to the creative economy.

Raw metropolitan prejudice, much
of which would resonated nicely within the snotty Parisian court circa 1750, was directed at the BBC’s
2010-2013 implementation of a strategic move of certain departments such as
Sport and Children’s to Salford (which is in Manchester, unless you are into
local council sophistry). A stream of prejudiced negativity, often from
nameless BBC staffers, was directed against the very idea of moving programme
production out of London to one of the other cities that paid for it.

The general theme was moral
outrage: how dare they? Max Hastings
wrote in the Daily Mail: ‘Like it or not, London is Britain’s cultural capital. The attempt to
shift one of its greatest institutions to the North makes no more sense than
greening Abu Dhabi.’

Clusters

On the Abu Dhabi point, Hastings
disregarded that many of the biggest success stories of British broadcasting
over the past 60 years had already originated in the North including the
world’s most successful long running soap (Coronation
Street), the two most cerebral long running formats on British TV (University Challenge and Mastermind), dramas from Red Dwarf to Prime Suspect and Colditz
(surely World War 2 buff Hastings’ ideal show?) plus current affairs from World in Action onwards.

Manchester’s opponents also
arrogantly disregarded the principle that there could be any hypothecated
political and democratic logic to locating the production dimension of a
publicly-funded entity more fairly across its funding regions.

And above all they disregarded
the economic desirability of creating a ‘northern powerhouse’ cluster (to
borrow a phrase from George Osborne) of the creative economy in Manchester. The
conceit was that creative capital belonged in a single overcrowded political
capital - and that conceit was wrong, because the BBC North project has worked.

The BBC with its reported £500m
investment (the exact level depends who you ask) kickstarted Media City to the
place it is today – a remarkably wide campus of production which encompasses
not only major departments but also (often unreported) major teams of BBC
digital R&D workers. Media City has concurrently added ITV output
spanning drama, entertainment and factual. It has added outposts of large indie groups and distributors (such as
the Red Production company, or the one I run, Shine North, part of the global
Endemol Shine Group). It now has some 3,000 TV workers. And it has digital and marketing start-ups, a
university campus, a brand new college for 14 to 18-year-olds targeting digital
employment, and much more.

As Media City came on stream, I
sat as chairman of the Royal Television Society North West across a doubling in
entries to our annual awards process from 2012-14 – and by no means just from
imported BBC entrants. We viewed entries as a wider production sector
bellweather, and we saw cultural engagement rise in doubled attendance at
events from quizzes to talks about the how-to of documentary making.

And in turn that multiplied
beyond, into a wider – if hard to attribute – renaissance in Manchester’s creative economy, which saw a step jump
in the digital sector over exactly the same period. Manchester had 70 per cent
growth in new digital companies incorporated between 2010 and 2013, against a
nationwide clusters average of 53 per cent, as measured by the Tech Nation
report (Morris and Penido 2014).

The report also said there were
now 56,145 digital jobs in Greater Manchester, and that 61 to 80 per
cent of survey respondents identified access to talent and social networks as
the key benefits of being in the region: ‘Manchester’s long-standing media
industry has now gone digital. The average company turnover growth is one of
the highest in the UK’ said the report. This was cluster economics at work. ‘Some £3.5 billion has been invested
to support Manchester’s digital and technology infrastructure. For example,
Salford’s £950 million Media City UK, Europe’s first purpose-built business hub for the creative and
digital industries.’

What the BBC brought to
Manchester was critical mass. It brought strategic scale to a strategic
industry. It was a world champion, championing a world class production
economy. It worked.

Compare that with the North East

Meanwhile the BBC didn’t do
anything of the sort in Newcastle.

They didn’t move any departments
to the Tyne, or inventive digital units. They didn’t open any staff canteens or national newsrooms or breakfast
shows. Granted, they have made superb drama
and kids productions – estimated at a £6m annual annual contribution to the
region’s economy by Northern Film and Media. Some of them have been seriously successful, like Wolfblood. But even the most ardent BBC corporate PR person couldn’t
argue the corporation invested at the same permanent scale as in Manchester.

And as a direct result, TV output in
the region, and the kicker effect that has on the rest of the creative sector, is,
in relative terms, flatlined.

Andy Becket wrote a Guardian
article in May 2014 titled 'The North East
of England: Britain’s Detroit', positing wide decline and an unclear
economic raison d’etre. It was widely
derided in the region as untrue and unfair, and certainly in the digital sector
there are signs of real progress.

Again, the Tech
Nation report identified strength in IT-based software engineering and
back-office IT support businesses (not least the FTSE 100-listed Sage and leading games
developers include Ubisoft Reflections, Epic Games UK and CCP Games). Fully 77% of companies surveyed reported
belief they are part of a digital cluster.

But what was absent was
critical mass in the creative media industries of TV, video content, radio at
the same level as was seeded in the North West by the BBC’s market intervention. In the Tech Nation’s skills mapping, there
was less adjacency for North East skills bases with the kind of creative
production skills the BBC is bringing to the North West. To Manchester’s 70% growth in new
digital companies incorporated between 2010-13, the North East had just 23%,
way below the national average.

And why does that matter? Because what happened in the creative elements
of the digital content economy in Newcastle, or rather what didn’t happen in
terms of cluster economics, jobs growth, ‘northern powerhouse’ - is a foretaste
of what could happen to the British creative sector as a whole without the
extraordinary kickstarting effect of the BBC at its heart.

California

In
1913 a young man was sent from New York to Flagstaff, Arizona to find a
location to shoot an ‘Indians’ (his word) movie.

Two
weeks went by - then a telegram arrived from Flagstaff: “No good for our
purpose. Want authority to rent barn in
place called Hollywood.”

That
was from Cecil B De Mille, and Sam Goldfish (who later changed his name to Sam
Goldwyn) telegraphed back: “Rent barn but on month to month basis. Don’t make any long term commitment.”

At
that point, no feature film had ever been made in Hollywood. These were the first guys in town to do more
than a short. Their seed investment, and
that of others, was one step in the Hollywood cluster being born. And once the
cluster was in place, it became unstoppable – an industry worth $679 billion to
the US in 2014.

In
a 2014 paper on Why Silicon Valley became
Silicon Valley, the authors concluded that the principle reason it happened
was not that it had inate geographic advantages, or a better technological
heritage. It was that the entrepreneurs
behind key businesses like Fairchild Semiconductor, who achieved some success
in the 1960s and early 1970s, were prepared to pay their success forward by
backing others, thereby creating a cluster effect. This didn’t even happen in Dallas, where
Texas Instruments had better technology.

Again
– it’s clusters of world-beating expertise based on seed investment and
re-investment.

The BBC as core of the UK creative cluster

That’s why this debate
matters. The creative industries are
worth £76.9 billion per year to the UK economy, according to a DCMS report
published January 2015. And at the heart of that is a core investor, in
which as a nation we have a controlling shareholding: the BBC.

We
have devoted seven decades of remarkably stable national investment into that corporation,
and it is repaying us. Not only with a
cultural richness that keeps us entertained on the Peak District moors, not
only with a cluster of employment in cities Manchester that is helping to drive
a dynamic rebirth of the city’s economy as a digital production and tech hub
with critical mass, but also with a production industry that is British and
world-class like very few others today.

If
we tinker with the BBC we take a risk of undoing our uniqueness and becoming
like everyone else - without the global impact of a BBC-powered creative
economy.

So reform the BBC? Sure. But don’t deny for a moment it’s pivotal role as the UK’s
region-boosting, world-beating creative kickstarter.

Alex Connock (@mralexconnock)is Managing Director at
Shine North, Visiting Professor at Manchester Metropolitan, Salford and
Sunderland Universities, Visiting Fellow at Manchester Business School and Chairman
of the RTS North West.

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